Characterization of additive cost sharing methods

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Characterization of additive cost sharing methods

The set of additive cost sharing methods when individual demands are integer valued and cost shares are non negative, is characterized by its extreme points and by a network flow representation. The extreme methods allocate costs incrementally along a chain of demand vectors independent of the cost function. The result generalizes Wang’s characterization in that we do not assume the Dummy axiom.

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Characterization of additive cost sharing methods ∗ Hervé Moulin and Rakesh Vohra April 2003

The set of additive cost sharing methods when individual demands are integer valued and cost shares are non negative, is characterized by its extreme points and by a network flow representation. The extreme methods allocate costs incrementally along a chain of demand vectors independent of the cost function. The result generalizes Wang’s characterization in that we do not assume the Dummy axiom.

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Paths and consistency in additive cost sharing

Using a new representation theorem for additive cost sharing methods as sums of path methods, we show that many of the standard additive cost sharing methods (Aumann-Shapley, Shapley Shubik, and Serial Cost) are consistent. These results follow directly from a simple suucient condition for consistency: being generated by associative paths, which can be used to show consistency for many other me...

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On demand responsiveness in additive cost sharing

We propose two new axioms of demand responsiveness for additive cost sharing with variable demands. Group Monotonicity requires that if a group of agents increase their demands, not all of them pay less. Solidarity says that if agent i demands more, j should not pay more if k pays less. Both axioms are compatible in the partial responsibility theory postulating Strong Ranking, i.e., the ranking...

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Optimization Based Characterizations of Cost Sharing Methods

We provide several new characterizations of well known cost sharing methods (CSMs) as maxima of linear (or convex) functionals. For the Shapley-Shubik method the characterization has an interpretation in terms of randomly ordered agents choosing their most preferred CSM, while the characterizations of the Aumann-Shapley and Serial methods have a very general character: any symmetric convex func...

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ژورنال

عنوان ژورنال: Economics Letters

سال: 2003

ISSN: 0165-1765

DOI: 10.1016/s0165-1765(03)00113-7